Introduction to sunspots and lotteries

Edward Prescott, Karl Shell

Research output: Contribution to journalArticle

9 Citations (Scopus)

Abstract

This introduces the symposium on sunspots and lotteries. Two stochastic general-equilibrium concepts, sunspot equilibrium (SE) and lottery equilibrium (LE), are compared. It is shown that, for some general, pure-exchange economies which allow for consumption nonconvexities or moral hazards, the set of LE allocations is equivalent to the set of SE allocations provided that the randomizing device can generate events of any probability. Journal of Economic Literature Classification Numbers: D51, D82, D84, E32.

Original languageEnglish (US)
Pages (from-to)1-10
Number of pages10
JournalJournal of Economic Theory
Volume107
Issue number1
DOIs
StatePublished - Nov 1 2002
Externally publishedYes

Fingerprint

Sunspots
Lottery
Sunspot equilibria
Non-convexity
Economics
Moral hazard
Exchange economy
Symposium
General equilibrium

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Introduction to sunspots and lotteries. / Prescott, Edward; Shell, Karl.

In: Journal of Economic Theory, Vol. 107, No. 1, 01.11.2002, p. 1-10.

Research output: Contribution to journalArticle

Prescott, Edward ; Shell, Karl. / Introduction to sunspots and lotteries. In: Journal of Economic Theory. 2002 ; Vol. 107, No. 1. pp. 1-10.
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